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After May 1, East Europe's 'Haves' May Have More

For 60 years in this place of lakes and forests, Gerard Pakura's life has unfolded in step with Europe's history, from the Nazi occupation of his land to the rise and fall of Soviet Communism.

But when his country enters the European Union on May 1 as one of 10 new members, Mr. Pakura may well discover that this latest redrawing of the political landscape is one upheaval too many for peasant farmers like him with no evident niche in the big and brawny Europe that Poland is about to join.

As Europe expands in a quest for prosperity and elusive unity, many among its new members in the East fear that hundreds of thousands of people may be left behind in a new underclass, throwbacks to the lost era of command economies and state control.

The European Union has always known its relative disparities, and to create a unified whole it has over the decades self-consciously transferred wealth from richer countries like Germany and Luxembourg to poorer ones like Portugal, Greece and Ireland.

But never before has the union invited into its well-padded ranks the kind of economic malaise to be found in rural Poland, the eastern reaches of Slovakia and Hungary and the countryside of the Baltics.

So daunting is the challenge that the 15 current members have decided that leveling the playing field is not an option, at least not fully, not for the foreseeable future.

Most of the agricultural subsidies that take up almost half of the European Commission's annual budget of $120 billion will not be available to farmers like Mr. Pakura and his neighbors in the other new eastern members, because extending the benefit was deemed too costly.

Farm subsidies for the new entrants will start at just a quarter of the western levels, rising to parity only by 2013. In the meantime, small-scale farmers in the East worry that they will be wiped out by agribusiness in the West, where subsidies on average provide a quarter of the income of most current European Union farmers.

''Everybody is trying to find a job,'' said Sylvester Frankowski, 18, who earns around $200 a month as a foot soldier in the Polish Army and has just returned to this hamlet of eight houses from a six-month stint in Iraq.

''They don't want to stay on the farm,'' he said, ''they are afraid that in the E.U. the farms will be too small to exist.''

Among new entrants, Poland is a particularly extreme example of dependence on small-scale agriculture and the biggest challenge among the group to the system of farm subsidies that both underpins European agriculture and inspires such furious arguments in the broader debate over the global trade in farm products.

In Poland about one-fifth of the work force is still on the land -- five times the current European Union average. More than half of those farms cover less than 12 acres, about a quarter of the European average, according to Andrzej Zedura, a government official.

Poland employs 19 percent of its work force on the land compared with, say, about 6 percent in Hungary or, among the ''old'' Europeans, about 4 percent in France, according to European Union figures.

It has 45.5 million acres under cultivation -- almost as much as the 48.4 million acres of the nine other new member countries combined.

So for Poland the potential disruption to the economy and to generations of rural life is enormous. But even as Poles seek to leave the farm, jobs are hardly plentiful in the rest of the economy, and wages compared with current members are barely more than a pittance.

The European Union, for instance, estimated the relative purchasing power of Poland's 38 million people at just 39 percent of the union's existing average. That put Poland fourth from the bottom, ahead of only the three Baltic states -- Estonia, Latvia and Lithuania -- which are also joining in May.

As a whole, the 10 new members will expand the union's population by about one-fifth, from 380 million to 455 million, but they will add only 5 percent to its economy.

''Now there are two Polands,'' said Bogdan Tatarkiewicz, the deputy manager of Farm Frites, a huge plant 50 miles from here in Lembork that makes frozen and packaged French fries for McDonald's and others.

''There's a very rich Poland,'' Mr. Tatarkiewicz said, ''and a Poland B team, who are not accepted by employers because they have no skills. There are those with the ability to work with foreign investors, and the rest, like peasant farmers, left on the ice.''

Poles like Mr. Frankowski and his 78-year-old grandfather, Leon, express certainty that the economic juggernaut that is the European Union will overtake the small, slow rhythms of life that Poles have sustained through centuries of war and trauma, often on the most modest of holdings.

Others, like Mr. Pakura, one of Poland's 1.9 million farmers, appear to be gloomy about their fate.

''During the Communist time we sold everything we produced,'' he said in an interview in the cramped parlor of his wooden farmhouse, across the way from a barn and a silent, frozen lake. ''The state was obliged to buy it. Now it's not even worth trying to sell milk.''

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Today Mr. Pakura's farm -- with its seven acres of poor land, two cows and a modest assortment of pigs and chickens -- does little more than feed his family, which includes three of six children still living at home. Mr. Pakura's wife, Jadwyga, milks the cows by hand.

The family budget of some $500 a month depends mostly on a daughter's paycheck from a clothing store, a $100 monthly pension for Mr. Pakura and earnings from odd jobs.

Soon this mom-and-pop operation will be competing in the same marketplace as better subsidized industrial farmers like Ulrich Pöggel, who manages 7,000 acres of what used to be a state-run cooperative in East Germany spread across flat, damp lands at Altenhof, about 90 miles north of Berlin.

Not long ago it, too, was part of the Communist East. But since Germany reunited in 1990, Mr. Pöggel (pronounced PER-gel) has benefited not only from the hundreds of billions of dollars that the government spent to refurbish eastern Germany, but also from the European Union's ample farm subsidies.

Mr. Pöggel says his German subsidies, calculated according to the acreage of his land, yield some $1.1 million a year, not counting other contributions from the European Union for each slaughtered cow or animal kept for breeding.

Today his outfit, which combines dairy farming with a lucrative and expanding business leasing tractors, machinery and expertise to other farms, has 800 cows and 750 calves. Each cow in his plump and well-fed herd produces around 2,000 gallons of milk a year.

''I don't think we will have any major competition in the next few years'' from the countries newly joining the union, Mr. Pöggel said in an interview.

That is not least because most of the subsidies he receives will not be available to small Polish farmers like Mr. Pakura or any of his East European counterparts.

''We can't compete with subsidized European food,'' Mr. Pakura said, his words revealing how little he feels part of the ''Europe'' he is to join.

The European Union has set aside some $600 million for grants to small farmers in Eastern Europe, encouraging them to use their land for other purposes, like tourism. But that will not be easy.

''There are 20 pages of application forms, and the same for a business plan,'' said Grzegorz Lepkowski, a consultant in Kartuzy, 10 miles south of here, who specializes in helping people deal with Poland's notoriously arcane bureaucracy. ''You need a computer to fill it all out. So for a normal farmer it's impossible.''

Some local officials have come to see opportunities for private enrichment in the changeover to West European ways.

''Everybody who is higher up -- to the very top level -- can take money from the ordinary people for doing something they are supposed to do for free,'' said Mariusz Kasprzak, 38, a local councilman who campaigns against corruption. ''The money doesn't go where it's supposed to go, because it has to go through all these hands first.''

Indeed, as the European Commission said in a recent report, corruption is increasing in Poland as membership in the union approaches, and it ''is considered to affect all spheres of public life.''

By contrast, people like Mr. Pöggel benefited not just from being quicker into Europe, but from being German. Altenhof, Mr. Pöggel said, enjoyed the good fortune of an adventurous and wealthy western investor, Lorenz Peter Stotz, who after the fall of the Berlin Wall in 1989 swiftly struck a deal to turn part of the former Communist enterprise into a capitalist agricultural business.

''The old party functionaries and the western investors found each other very quickly and worked out how to get the subsidies from Brussels,'' said Klaus Schröder, head of a research group at the Free University in Berlin.

That may yet happen in Poland, or in other new member states like Latvia, where newspapers report that farmland is already being snatched up by investors from Denmark, Finland and the Netherlands. But even in the case of eastern Germany, the new investment was not always to the advantage of all.

In the old days, Mr. Pöggel said, the cooperative employed 50 people to look after some 300 cows and 200 calves. Now, in a development that bodes ill for Poland and the other new European Union states, only 12 people are needed to tend 800 cows and 850 calves.

''There is a lot of envy here now,'' Mr. Pöggel said, ''envy of who has a job by who has not.''

Articles in this series are examining the European Union's growing pains as it prepares to add 10 members this spring.

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A version of this article appears in print on March 27, 2004, on Page A00006 of the National edition with the headline: After May 1, East Europe's 'Haves' May Have More. Order Reprints|Today's Paper|Subscribe